Supply chain is the fastest way to widen margin and lift enterprise value — and most companies still run it as a cost to be minimized rather than an advantage to be built. In this episode, Michael Zakkour sits down with an operator who took a scaling brand from constant stockouts and air freight to a working-capital engine, and walks through exactly where the leverage lives: inventory accuracy, fulfillment design, and the cash trapped between a purchase order and a paid invoice. The throughline is simple. When supply chain, technology, and finance share one set of numbers, the cost center quietly becomes the competitive edge.
In this episode
- Why “cost center” thinking caps growth, and what changes when supply chain is treated as a profit and valuation lever.
- The inventory math that frees cash: SKU rationalization, forecast accuracy, and turns as the metric that ties operations to working capital.
- Fulfillment network design — where to hold inventory, when to add a node, and how shipping zones quietly tax acquisition.
- How a clean supply-chain story raises the multiple a buyer or lender will pay, long before a transaction.
Transcript
Abridged for reading. Lightly edited for clarity.
Zakkour: Most founders I meet treat supply chain as the thing the COO worries about and finance funds. You ran it as a growth lever. When did that switch flip for you?
Dana Okonkwo: When I realized our biggest line of credit was sitting in a warehouse. I was the VP of operations at a home-goods brand running about sixty million in revenue, and we were profitable on paper and broke in the bank. We had nine months of certain SKUs and air-freighting the ones that actually sold. The board kept asking why we needed more capital. The answer was that we had buried it in inventory.
Zakkour: That is the pattern. People look at the P&L and miss the balance sheet. So where did you start — turns?
Dana Okonkwo: Turns and accuracy, in that order. We didn’t trust our own numbers, so every decision had a fudge factor baked in, which meant overbuying. We rebuilt forecasting against real sell-through, cut the SKU count by almost a third, and got cycle counts to the point where the system and the shelf agreed. Inventory turns went from roughly three to closer to six in about four quarters. That alone pulled millions in cash back out.
Zakkour: And that cash is free. It is cheaper than any round you could raise. What did you do with the fulfillment side?
Dana Okonkwo: We mapped where orders actually went and discovered we were shipping most of the country from one coast. Every order crossed three or four zones, so we were paying a tax on each shipment and our delivery promise was soft. We added a second node in the middle of the country. Average zones dropped, ground replaced a lot of expedited freight, and delivery speed improved without us touching the ad budget.
Zakkour: People forget that fulfillment is part of acquisition. A faster, cheaper delivery promise converts better and costs less to serve. That is two pillars working together.
Dana Okonkwo: Right, and technology is what made it visible. None of this works on a spreadsheet that updates monthly. We connected the order system, the warehouse, and the planning tool so the same number meant the same thing everywhere. Once finance and operations were reading one set of data, the arguments stopped. We were debating the decision, not the numbers.
Zakkour: Let’s talk valuation, because this is where it gets interesting for founders thinking about a raise or an exit. What did the cleaner supply chain do to how the business was valued?
Dana Okonkwo: It changed the conversation entirely. When we went out to refinance and later to talk with a strategic buyer, the diligence on inventory and fulfillment went fast because the data held up. A predictable supply chain reads as lower risk, and lower risk is a higher multiple. The same EBITDA was simply worth more because the buyer could see the margin was durable, not a one-time squeeze.
Zakkour: That is the part operators underprice. You don’t build that story in the data room. You build it years earlier in how you run inventory and cash.
Dana Okonkwo: Exactly. If I could tell a scaling founder one thing, it would be to stop thinking of the warehouse as overhead. Every turn you add, every zone you remove, every forecast you tighten shows up in cash, in margin, and eventually in the price someone pays for the company.
Zakkour: One partner, one set of numbers, supply chain treated as an advantage. That is the whole game. Dana, thank you.
Dana Okonkwo: Thanks for having me.